The "meeting of creditors" or "341 hearing" is the one appearance almost all bankruptcy filers must make. The primary purpose of the meeting of creditors is to allow the bankruptcy trustee responsible for your case to verify your identity and ask questions about the information provided in the bankruptcy petition.
Once complete, most filers feel a sense of relief. However, debtors must complete additional tasks before receiving a "bankruptcy discharge," the order that erases qualifying debts. What you'll need to wrap up before concluding your bankruptcy case will depend on the chapter filed and if any outstanding issues exist.
You likely remember taking a course before filing for bankruptcy. Before receiving your discharge, almost all filers must complete a second course in financial management, known as the "debtor education course."
If you filed for Chapter 7 bankruptcy, the deadline is 60 days after the initial date set for the 341 hearing. In Chapter 13 bankruptcy, you must complete the course before making your last plan payment or filing a motion for a hardship discharge. If you don't file the completion certificate by the deadline, the bankruptcy court will close your case without issuing a discharge.
If this happens in your case, you can fix the problem, but it will be costly. You'll have to repay the bankruptcy filing fee to file the certificate and receive your discharge.
All filers are responsible for responding to the trustee's concerns. When more time is needed, the trustee will schedule another hearing.
Continuing the meeting of creditors isn't uncommon and often happens when a filer doesn't bring the proper identification. It also occurs when the trustee needs additional financial documents, photographs showing property condition, or an estimate for necessary repairs to a home or car. In some cases, the trustee needs time to inspect a business property or inventory the contents of your home, although these requests are rare.
Also, if a creditor appears but needs more time, the trustee might continue the creditor's meeting to allow more detailed questioning. Regardless of the issue, the trustee will continue the 341 hearing until you provide everything needed in your case. Often, the trustee will take the continued meeting off the calendar if the information is provided beforehand.
Find out what the trustee will ask at the meeting of creditors.
Even if the trustee is satisfied with your bankruptcy papers and concludes the 341 hearing, creditors can file an objection to your discharge up to 60 days after your initial meeting of creditors. Objections to discharge are the exception rather than the norm.
Also, if you charged luxury goods or took out cash advances shortly before filing for bankruptcy, or you obtained credit through fraud, a creditor might have grounds to argue the debts should not be discharged. Your bankruptcy case will remain open until the issue gets resolved through a motion or bankruptcy trial called an "adversary proceeding."
Learn about using credit cards before filing for bankruptcy.
If you want to "reaffirm a debt" such as a car loan, you can sign a new agreement with the lender. Because the new agreement holds you responsible for a debt discharged in bankruptcy, you might need to attend a reaffirmation hearing so the judge can review your budget and verify that the contract won't cause you or your family undue hardship. If you have a bankruptcy lawyer, your attorney will verify your ability to afford the reaffirmation payment.
In Chapter 13 bankruptcy, the court and the trustee must approve or "confirm" your repayment plan before it is finalized. If the trustee believes the Chapter 13 plan isn't feasible—perhaps it doesn't pay all required debts, or you don't earn enough to make the required monthly payments—you or your bankruptcy lawyer must attend a confirmation hearing before the judge and explain why your case should be approved. In some jurisdictions, you might need to go to a confirmation hearing even if the trustee approves your plan at the meeting of creditors.
Chapter 13 filers must make all monthly payments for three to five years and complete the Chapter 13 plan before receiving a discharge. The bankruptcy court will discharge qualifying debt balances only after plan payments are complete, and the filer verifies that other required payments, such as support obligations, are current.